Employees are waiting for any updates ralated to EPFO as they often updated rules and regulations to provide more benefits to the members. Recently, they have changed some rules, which perhaps you don’t know.
EPFO Rule change update
The Employees’ Provident Fund Organisation (EPFO) has announced liberalization of partial withdrawal rules for its over 300 million subscribers. This important decision was taken at a meeting of the Central Board of Trustees (CBT), the highest decision-making body of the EPFO, chaired by Labour Minister Mansukh Mandaviya. A statement issued by the Labour Ministry said that these new rules are aimed at making the lives of EPF members more convenient, according to media reports.
Keep these 3 things in mind
Employees’ Provident Fund Organisation (EPFO) members will now be able to withdraw up to 100 percent of their entire eligible balance, which includes both employee and employer contributions. Under earlier rules, members could withdraw their entire PF amount only in case of unemployment or retirement. At that time, members could withdraw up to 75 percent of their PF balance one month after joining a job and the remaining 15 percent two months after leaving a job. Now, as per the new rules, the period for withdrawing the entire amount in case of unemployment has been increased from 2 months to 12 months. Furthermore, in case of retirement, this period has been increased from 2 months to 36 months. This change will enable EPF members to fully benefit from their provident fund.
To simplify members’ lives, the CBT has eliminated 13 complex partial withdrawal provisions and consolidated them into a single, streamlined rule. These rules are now broadly classified into three categories: essential needs such as illness, education, and marriage; housing needs; and special circumstances.
A new provision has been added that requires members to maintain a minimum balance of 25 percent of their contributions in their accounts at all times. This will ensure that members can accumulate a high-value retirement fund by taking advantage of the high interest rate offered by EPFO ​​(currently 8.25 percent per annum) as well as the compounding benefit. These changes will provide EPF members with greater flexibility and convenience in accessing their funds during financial emergencies.
